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December 5, 2009

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Xi'an Aircraft buys Austrian parts maker

CHINESE plane maker Xi'an Aircraft Industry (Group) Co has acquired a majority stake in an Austrian aircraft parts maker for about 100 million euros (US$150 million) -- the first time an Asian plane maker has acquired a European counterpart.

Xi'an Aircraft, a wholly-owned subsidiary of Aviation Industry Corp of China, and Hong Kong-based private equity firm Advanced Treasure Ltd jointly bought a 91.25-percent stake in Future Advanced Composite Components AG. Xi'an Aircraft owns 90 percent of their stake and ATL the other 10 percent, it said in a statement late Thursday.

"AVIC has talked with major clients of FACC, including Boeing and Airbus, and they pledged to support the deal and won't reduce orders from FACC," said Meng Xiangkai, president of Xi'an Aircraft.

FACC expects 271 million euros this year, slightly down from 276 million euros last year. Its profit before tax is expected to be 10 million euros. It has contracts worth a total of US$1.86 billion.

The Xi'an plane maker also plans to inject another 40 million euros to replenish the company's working capital.

Xi'an Aircraft plans to tap FACC's experience to enhance its own capability to compete overseas with global rivals.


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